The WHOA is a pre-insolvency debtor-in-possession scheme proceeding, which allows the debtor to impose a restructuring plan on dissenting (classes of) creditors and shareholders. The procedure is designed such that court involvement is in principle minimal and can be completed in a relatively short timeframe. If necessary, specialised judges can be involved before the restructuring plan is voted on, to get clarity on any issues that might prevent successful implementation of the restructuring plan and the intended restructuring.
The WHOA provides businesses with a structured and flexible process to negotiate debt agreements and restructure their financial obligations. This promotes collaboration among stakeholders and safeguards business operations and the interests of all involved parties. As such, this highly flexible instrument presents an alternative to insolvency mechanisms like the US Chapter 11 and the UK Scheme of Arrangement and Restructuring Plan.
The WHOA has proven itself as an effective restructuring tool used in both local and cross border restructurings. For more information, please reach out to one of our team members.